Sony sold its online game division, Sony Online Entertainment (SOE) to New York investment firm Columbus Nova for an undisclosed sum. The former SOE will operate under the name Daybreak Game Company and keeps its development teams intact. SOE, which launched in 1996 as part of Sony’s 989 Studios, was built to develop and run subscription-based massively multiplayer online games (MMO). They developed and released numerous MMOs including EverQuest, DC Universe Online, Planetside 2, and the recently launched zombie MMO H1Z1.

So given how important Sony Computer Entertainment and PlayStation are to Sony, why would it divest itself of one of its game studios? At its core, SOE ceased to be a strategic asset and just as they did a year ago when they sold off their PC business to focus on mobile it was time for SOE to go. Sony’s focus is on the very profitable PlayStation business and SOE’s focus is on developing pay-to-play (P2P) MMOs (primarily for the PC), in a market that is rapidly shifting towards free-to-play (F2P) games that require publishers to give games away and generate revenue through in-game micro-transactions.

Sony’s divestiture of SOE does not mean that it is getting out of online games, rather it signifies a sharpening of its focus on other aspects of its digital games business such as the PlayStation Network, full game downloads to the PlayStation 4, and downloadable content (DLC) such as maps, levels, and expansion packs. Furthermore, the cash from this transaction will enable Sony to invest into its other, more profitable divisions.